German Stocks Fall as ZEW Report Offsets U.S House Data

April 16 (Bloomberg) -- German stocks declined as worse-than-expected investor confidence data in the euro-area’s
biggest economy offset a report showing new-home construction in
the U.S. jumped more than forecast in March.

The DAX Index dropped 0.4 percent to 7,682.58 at the close
of trading in Frankfurt. The benchmark has lost 4.7 percent
since March 14 after concern mounted that a global economic
recovery may sputter amid disappointing data from the U.S. and
China and as gold had its biggest selloff since 1980. The
broader HDAX Index retreated 0.5 percent today.

“The ZEW report doesn’t help,” Christian von Schuler, a
trader at Hauck & Aufaeuser Privatbankiers KGaA in Hamburg, said
in a phone interview, referring to the confidence report. “We
had the commodities selloff, and the weak data from the U.S. and
China. We are in the middle of a classical risk-off trade,
people tend not to buy into an environment like this.”

In Germany, the ZEW Center for European Economic Research
in Mannheim said its index of investor and analyst expectations,
which aims to predict economic developments six months in
advance, fell to 36.3 from a three-year high of 48.5 in March.
Economists had forecast a drop to 41, according to the median of
40 estimates in a Bloomberg News survey.

U.S. Housing

In the U.S., new-home construction jumped more than
estimated as multifamily projects climbed to the highest level
in more than seven years.

Starts climbed 7 percent to a 1.04 million annual rate, the
most since June 2008, following a revised 968,000 annual rate in
February that was larger than previously reported, Commerce
Department figures showed today in Washington. The median
estimate of 80 economists surveyed by Bloomberg called for
930,000.

The volume of shares changing hands in companies on the
benchmark was 6.6 percent lower than the average of the last 30
days, data compiled by Bloomberg showed.

“There is pressure in the short term, but commodity prices
will stabilize, panic will leave the market and then you’ll have
investors looking back at an environment of low interest rates
and good corporate earnings,” said Herbert Perus, who helps
oversee about $36 billion as head of equities at Raiffeisen
Capital Management in Vienna. “All that bodes well for
equities.”

Utilities Drop

EON and RWE slid 5 percent to 13.74 euros, and 2.2 percent
to 29.48 euros, respectively, after the European Parliament
rejected a proposed change to emission-trading rules that would
allow the supply of carbon permits to be curbed temporarily.

The European Union assembly voted against a plan to delay
the issuing of some new allowances in the 2013-2020 phase of the
EU’s emissions-trading system. The draft measure opposed by the
27-nation Parliament is meant to help bolster the price of EU
emission permits after they fell to a record low in January.

ThyssenKrupp AG, Germany’s biggest steelmaker, rose for the
first day in four as metal prices including gold, silver,
copper, platinum and palladium advanced. The shares gained 1.6
percent to 13.86 euros.